Committee of the Whole - Township of Strathroy-Caradoc

2books, if the circumstances change attempts will be made to recoverthe amounts owed.Moved by Councillors Dausett and CameronTHAT: Finance Committee recommends approval to write-offinvoices totaling $145.55 based on the report dated November 30 th ,2011 from the Director of Financial Services/Treasurer.Carried.4. 2012 DRAFT BUDGET OVERVIEW UPDATEThe Chief Administrative Officer and the DFS/Treasurer reviewed thesubject update circulated with the agenda package showing theimpact on taxation is an increase of 6.2%; made up of increases tooperations and maintenance 3.23%, debt 2.37% and taxation andadjustments 3.90%, and a reduction in capital of 3.31%.The changes in tax dollars required is currently $740,284 which is6.2% more than what was budgeted for 2011. Tax rates wouldincrease 1.49%. The latest assessment statistics reflect a 4%increase. Based on the estimates rates for 2012, a house assessedat $200,000 will increase in value to $208,000 and the resultingincrease would be $78.01, or 5.81% for the municipal portion.In response to questions posed at the November 28 th meetingregarding recommended levels for reserves and reserve funds amunicipality should have, the DFS/Treasurer checked with ourauditor and was provided with the following information:- Capital reserves/reserve funds should equal theaccumulated depreciation/amortization.Our reserves are estimated to be $10.2 million by the end of 2012,and by this recommendation they should be $76.4 million. We couldachieve this level if we were to raise $ 4 million per year which wouldcover our yearly depreciation/amortization costs. We currently don’traise any tax dollars towards this.- Future Needs Reserve should be 5 -15% of taxationrevenues.This reserve is established by accumulating any yearly surplus, andprovides a buffer in the event of an unforeseen expense. Based onthis recommendation we should have $1.2 million in that reserve,and we have only $20,000. We have been using money from thisfund to offset tax increases over the last few years.- Accumulated depreciation/ amortization should beapproximately 30% of our capital assets.Ours is 37%. This means that we aren’t spending quite enough oncapital projects to keep up with the growing depreciation on ouraging infrastructure.Committee of the Whole Finance Minutes Dec 12 11